Colorado's seasonally adjusted unemployment rate jumped to 8.4 percent in December as a new round of COVID-19 restrictions hit the leisure and hospitality sectors.
The rate is the highest it’s been since reaching 10.6 percent in June, according to the Colorado Department of Labor and Employment. The state lost more than 20,000 nonfarm payroll jobs last month, on top of 4,700 jobs lost in November, marking two straight months of declines.
The downturn in the state’s employment picture coincided with several counties moving to a higher risk rating on the state’s color-coded COVID-19 dial used to classify the severity of an outbreak, according to Ryan Gedney, a senior economist with the CDLE. The move took a heavy toll on the accommodation and food service industries, which lost 29,000 jobs in December.
As the calendar rolled over into the new year, Gov. Jared Polis brought most of the affected counties back down a level, allowing restaurants to resume indoor dining at 25 percent capacity. That could improve job prospects, but the impact will likely be muted in the near-term, Gedney said.
“I still think cold weather is going to hold back some of that hiring in the restaurant industry,” Gedney said on a conference call.
The declines in leisure and hospitality were offset somewhat by gains in retail and administrative support jobs, Gedney said. Even with the losses, the labor force participation rate climbed to 69 percent, the highest since February.
Colorado has gained back 191,500 of the 342,300 nonfarm payroll jobs lost between February and April. That translates to a job recovery rate of 55.9 percent, roughly equal to the nationwide recovery rate.
Job losses in December were concentrated along the Front Range, Gedney said. The counties with the highest unemployment rates are Pueblo, Huerfano, Gilpin, Costilla and Clear Creek.